No N-deal to hamper India's image: Lord Desai

India's standing in the international community will take a beating as it has become evident that the Indo-US civil nuclear deal has been given a silent burial, said eminent economist Lord Meghnad Desai.

He was speaking to media persons on the sidelines of convocation ceremony of the Tata Institute of Social Science here today. It will take time for India to repair the damage it has suffered due to this episode, he added.

It is tragic that United Progressive Alliance (UPA) government lost its calm and nerve to "disgraceful pressure tactics by the left.  Left has no qualms about having the treaty with foreign power if it is China but when it comes to America, it tries to find all the loopholes in the deal", he charged.


Replying to question about rising food prices Desai said: "I am amused by the hue and cry on US president George Bush statement that prices of food in the world are increasing because of consumption in India and China. This shows the defeatist mentality of the Indians".

Indians should learn to take such statements in stride and understand that this is, in fact, recognition of India's growing economic stature in the world, he added.

This (rising food prices) is a temporary phenomena as currently the supply side is weak and demand is constantly increasing. However, this phase will be over soon, he said.

Desai said that if prices were to stabilise, the responsibility of food storage and distribution should be taken away from a "third rate body like Food Corporation of India (FCI)" . "Because of its run-down storage facilities, the country loses 15 to 20 per cent of precious food stock annually and if this food comes to market, it will ease the pressure on prices of food items" he said. India should encourage massive investment in transportation, storage and distribution of food, he said.

Contrary to popular belief, the Central Government's policy of keeping oil prices in the country artificially low was causing inflation and by doing so, government was subsidising the middle class motorist at the cost of the poor, he pointed out.

Answering to a question Desai said, "If we adjust crude oil prices to inflation and the depreciation of dollar against all major currencies, the prices of crude have barely touched what they were in 1980s".